tv World Business Today CNN June 17, 2011 1:00am-2:00am PDT
who doesn't react. >> do you think you'll get married again? would you like to? >> i think so. >> a nice way to end all this, wouldn't it? >> yeah. i think so. >> well, good luck. it's been a pleasure meeting you. >> thank you. nice to meet you. >> thank you very much. >> thank you very much. that's all for us tonight. -- captions by vitac -- www.vitac.com hello, and happy friday from cnn london. i'm nina dos santos and these are the stories. the greek prime minister makes a fresh bid to pass on popular spending cuts. shares of research in motion tumble as the blackberry maker struggles to keep up with
competition. >> reporter: two greek super powers share the stage in st. petersberg. they want to see a four-fold increase in bilateral trade by 2020. so asian stock markets have their record seventh straight week of losses, their worst return since back in 2004. markets in the united states did manage to bounce back slightly on the housing and jobs numbers, but in europe the stock markets are heading down as, of course, greece's future remains up in the end. let's take a look at the markets. what we should be able to see is a number of european markets started trading a number of hours as go with numbers right across the board. the heaviest losses coming right across again. now, an angry public opposition within his own party
downgraded debt ratings, declining gdt, and real population that these could default on their bills. those kind of challenges currently facing greece on this friday and they may be motivating a new spirit of compromise right akroz europe. the prime minister is naming a new candidate on friday, including making defense minister the new finance minister. he's also hoping to boast support for another round of austerity measures aimed at winning a $16 billion loan. what's at stake? the stability of the euro and maybe the global economy is what's at stake. as china's foreign ministry said on friday, quote, it's viet rally important that europe manages to overcome its euro debt crisis. we're joined now live with the latest. diana, we saw thousands of people taking to the streets
yesterday and the day before. what's the sense you're getting on the streets in athens. has the anger dissipated to an extent? >> i don't think the anger is going to dissipate any time soon. this is a people that feel they're bearing the front of some vary austere measures and they say they can't cope with anymore. what the cabinet reached that we're seeing this morning may do, though, is pacify the rebellion within george pop a deo's prime ministry, he's batting two fronts, on the border and with the public. what this might do bringing in a seasoned pollty shann, an evangelist prime minister to bring unity. it may pacify them and at least
it means he has his party behind to push through these reforms which are always going to be unpopular with the public. >> diana, what this crisis has really shown us is that the greek people don't believe their own politicians, they don't trust them to get out of this mess, but really what they're saying in london, it doesn't matter what they're saying in athens, it's the imf that's dictating the terms. >> reporter: it is the imf who are dig tating the terms but they can't do thanh less they get the greek government on board. and they got the greek government supportedly on board with that first bailout package a year ago. those austerity measures were then implemented and haven't had the desired effect because now grease need as whole lot more money. in this karks in this scenario, as you say, the prime minister
doesn't have any options. if he doesn't get the next set of funds, greece will be three-fold. but there is communication going on in the euo and imf on how much will be involved in any kind of restructuring, reprofiling, whatever you want to call it. and as long as that conversation is ongoing and as long as that there's this talk about this huge credit problem, then there's room for discussion here also. there's room for the opposition to keep saying europe is negotiating. they're continuinging to talk. we therefore have a strong negotiation position. we should continue to try and make the terming better for us. the fact of the matter is p papandreou doesn't have any reaction. compromise may be in the works. the imf has agreed to.
the leaders of germany and france are currently meeting in berlin today to try to work out their differences on whether private investors must participate in a bailout. joining me now from our paris bu row is alexander. how confident are they that they'll stave off a default? . >> reporter: i'm not really that department. there are two issues here. the first issue is liquidity. you can't always make sure that greece can make its commitment in one month's time, three months' time or six months' time. you can't keep on giving bailouts, $100 billion here, $100 billion there. until the end of the day until they work to stabilize the fiscal condition, they will not
be able to stay on the long-term issue of default. so until they head to a very substantial reprofiling, it's going to depend whether after that they classify that as a technical default or not. and the day we head into a technical default is the day we work on the financial restraints. they could head into meltdown. they we've got to try to avert this crisis. time is now of the essence, so we need to reach an agreement extremely, extremely quickly. >> wouldn't it be profiling to a certain extent to give the greeks enough time to pay off their debts, just push the problem under the carpet? there's been a lot of talk about kicking the can down the road here. >> yeah. that's a major question. are we kick the can down the road? do we need to say, okay, we need
to face the long-term issues and short-term issues? that's the question. i'm not that sure because -- why i'm not that sure, okay, they can settle for six and there are many things that can be solved for maybe 50 to 60 billion euros. they've got to have a huge impact on gdp growth. of course, that will limit tax inflows. so at tend of the day, unless grease is bailed out time and time again, it's not going to be able to get back onto its feet. that's where my concern is that we're baling out greece under the implementation that they're going to be strict measures but that's based on gdp growth and consumer spending. 157 is extremely, extremely
high. i'm really not that confident that greece is going to be able to face up to its long-term commitments. the problem is it wasn't that strong of a candidate. it has now entered the euro and it it's putting all the other countries in to a terrible position. >> do remember that angela merkel and nicholas solas sarko expected to speak in an hour and a half. you'll see that on cnn. this man, the acting managing director john lipsky took a hardline stance if they failed to guarantee the latest bailout. he delivered the outcome on the sidelines of last month's summit in france. that was a week after the funds'
former chief dominic strauss-kahn had resigned. the asian stocks have been on the slide all week. in fact, the seventh straight loss. nikkei was down 0.64%. in hong kong after a distinctly underwelling first day's trading for sampson night on thursday during the -- during that time, the they sole. prada is now trying its luck at its first initial offering. it was discounted sale of the handbag company that allowed it to raise $2.1 billion. seoul, shakospi and shanghai bo
losing. more on the weekly benefits claims fell and new home construction rising but it was still overshadowed, yes, again, by the european debt crisis. the dow was up. the nasdaq, however, was down by a third of 1% and the s&p 500 was somewhere between those two firsts. and here's where the figures stand today in the u.s. down across the board. we do have a number of hours before things kick off on wall street. well, the talk offed by money and big opportunities for business continues in russia and we're live at the international economic forum in st. petersburg next. new neutrogena® rapid wrinkle repair. its retinol formula smoothes wrinkles in just one week. why wait if you don't have to.
hello and welcome back to "world business today" on cnn. in other top business stories for you. documents claim that dominique strauss-kahn pleaded immunity. hoe pleaded not guilty to sexually assaulting a hotel maid. one of strauss-kahn's would-be successors is courting china. the mexican central bank chief says he'll give emerging markets more of a say at the imf if he does get the top job. in the meantime his rival christine lavelis ahead. pleek sales last quarter
have forced rimm. r.i.m. stock has plunged. r.i.m. hopes that its new operating motion will help to turn things around but the launch of the blackberry os 7 is delayed until august. until then they'll have to rely on the cheaper handset sales. now, let's continue our coverage at the st. petersburg forum. they're currently discussing the global economy and the opportunities lying ahead. taking senn tear stage, russian president dimitri medvedev.
they're holding talks over a gas deal and also high on the list is energy security. we're following every twist and turn. john, plenty of deal manufacture-mamanufactur-making going on. it's a big day. >> a big hour. sharing his views. a period of time when we went from zero private sector to some 60% today but he had some warnings that russia could enter a period of stagflation if they didn't push into the next level of privatization. he was suggesting that prime minister vladimir putin. it's good to remember the two may be vying for the same seat in the next elections in march
of 2012. one thing that's happened here, a sea of friendly relationship between russia and china. he's talking about taking trade with russia from $55 billion today to $200 billion by 2020. it's a point i raised with the ceo of sistema. let's take a listen. >> yeah. i think the basic foundation is obviously the energy sector because china needs energy to continue its development that we observed over the last few years. this is a very natural partner for russia and also a chance to
build a dream partnership. >> partnering up. it seemed obvious it didn't happen before. was there not a trust to set up the deals. >> i think it's a matter of economic foundation, whether there's a pure economic sense in building, you know, things together, and now we see that both economic and political aspects work and it's becoming more and more interesting. >> you're looking at other markets yourself, sistema. why does it look so attractive? >> well, india from our perspective with china, market with the biggest potential globally because they have more than a billion population. this population is young, increasing. and by 2030 there's a forecast that india will become bigger than china. >> so you have to be there basically. >> yeah. the comfort levels are very, very low. clearly they want to make their
life better. they're competitive. we see the con soormer sector growing. the gdp growing at 10% annually. even through the crisis by tin term demand. so it's a market one should think about if one things about expansion. >> the biggest concern on the ground for 2012 seems to be who will lead the country, whether it's medvedev or president putin yet again. i'm a foreign investor. i'm looking at the country. what's your answer to them when they ask that question? >> i think the right question to ask is whether the microeconomic industry will continue. i don't see much of the political uncertainty, but at least in our sort of doing business and thinking about investment, we don't really picture in a lot of volatility or political risks.
>> reporter: mikael shamolin. one of the largest groups, sistema. >> they haven't seened any deals yet. they siped an inivl imu. no surprise here. going back to the interview that china wants to tap into the coal resources of eastern russia. we'll have the ceo in the second half of the program after the panel of 20 5 sitting around. "world business today" will continue right after this short break with nina dos santos. let me tell you about a very important phone call i made.
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get help paying for what medicare doesn't... and save up to thousands of dollars. call this toll-free number now. from cnn london, welcome back. it may be out of office but he still has a pile of campaign cash. brian todd reports he won't be able to take the money with him. >> reporter: the outgoing congressman references his humble financial background. >> the story of middle-class background is my story and i'm very proud of that. >> reporter: anthony weiner has a few hundred,000 dollars to fall back on if he needs it. that includes a stock portfolio worth between $190,000 and
$285,000. he's got campaign money, more than $365,000 cache war chest and more for his prospective campaign as mayor in 2013. >> what can he do with all this money? >> he can't take it with him and go to disneyland. he's not able to convert it to personal use. >> ken gross was much chief of enforcement. he said weiner could keep those accounts intact if he decides to run for either of those offices in the future. if he durngts he has four options. he can give it to other candidates, give it to a charity, to a party committee or give it back to donors. ken gross donors to disgraced politicians often demand their money back. as to other candidates. >> if he wants to give it to
other candidates would they take it or is he too radioactive? >> i don't know. yes, he's leaving under a cloud but he's not going to prison. he didn't violate the law. i think some may think it's a little radioactive but i wouldn't be surprised if over time they accept it from him. >> reporter: according to the nation national congressional committee. they targeted those he gave money to during his time in congress and demanded that they give it back. the nrcc says so far only seven of daents have given the money back. brian todd, cnn, woo. the weiner story is one we've covered quite a lot which is more than can besaid about the man in question, but for the remaining few who haven't had the unquestionable question of seeing him uncovered now.
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from cnn london, i'm nina dos santos. this is "world business today." welcome back. now, we want to go back to one of our top stories today, the economic international forum currently under way in st. petersburg, russia. leaders from right around the world are discussing the global economic opportunities that line that country and elsewhere. for the host nation, russia itself, oil and gas, of course have been the bread and butter of that country's economy, but now a new generation of entrepreneurs are looking to diversify and as reported, inventorship, it seems, isn't the issue. >> reporter: in her research lab she perfects her own medical innovation. it's a fie russ gel that bonds with human tissue, a kind of artificial skin that she says could treat burns, even mend broken teeth and bones. this whole process was dreamed
up and developed in russia by her. >> translator: i met people with a long period for rehabilitation in hospitals. they can span more than a month in bed, sometimes even three or four. so i wanted to create a material which would speed up the healing process and make their rehabilitation process shorter. >> reporter: her skin substitute is still being test bud once approved she hopes kit can be use a widely used treatment primarily for russia. it's kind of the innovative product that the russian country says it needs to divert away from oil and gas. the problem is here in russia has hassan been invent ivgness. it's been turning it into successful businesses.
this is a recent graduate taking advantage of russia's latest drive to encourage high-tech designs. it's it's already been put into production thanks to russian grants and support. but even constantine believes the russian system is prone to abuse and needs careful oversight. >> translator: the government needs to lick question dade companies, created just to get state money. they shut down as soon as they get it. there are many of them. there are firms that are really in need of cash that are left with little support. >> reporter: maybe tougher competition for grants, say research researchers, could help decide which new companies have most potential. with russia's new generation of innovators build their country's future. matthew chance, cnn, moscow. let's go back to john
defterios. he joins us leave from the scene of the international economic forum under way in st. petersburg. let's go back to what you were saying about medvedev pushing for reforms like chancellor merkel has been showing us. the question is will he be in charge in a couple of years from now? >> reporter: it's a key question because they'll have elections in march of 2012. mr. medvedev said the economy is starting to crawl. the economy at $1.7 trillion but what happens next? it's a key question for the next generation. you talk to a lot of business leaders and they say, look, basically block out all the politics right now because one of them will lead in 2012. does the 2020 provizatiivatizatn
survive. let me welcome to the program the chief executive officer of the italian embassy. nice to have you on the program. william. we heard the speech of president medvedev in the last half hour. it's interesting the forging of the partnership between russia and china, not surprisingly nermg and potentially disagreeing over pricing right now. but this is a new reality, a giant consumer coming on the scene and a giant supplier. they can eat each other out. >> china will be using a lot more gas. they need the supply and russia is the supplier. >> there's a roundtable that you're going to be part of. can we expect any surprises
other than a partnership in 2012? what can russia do noekt dig in and find more resources for the future? >> when russia can open more its doors to foreign investors. it was, of course, a big step in the right direction but there are other steps that can be made in order to make russia more accessible. >> specifically do you want to tell us what you're thinking? >> well, specifically, you know there are fields all over russia. there are a lot of resources which can be explored and put into production. they probably need new technology. we have certainly wanted to do that more nan the past. >> you've commit $1.25 billion when you get your gas operations fully implemented but you're a largest client of gazprom. you're collected on the blue line, trying to get gas into turkey right now. are you worried about political
stability here or are these agreements sealed up for the next two decades. >> >> i'm not wired. generally speaking the energy sector is always somewhat protected by instability. even this countries much more up stable, we continue tro produce hydrocarbons and we continue to lead a peaceful life. >> you chose not to go into nabutko. what was the reason for not going into na buco. >> you see, we have been part of some of the biggest projects in gas pipelines in the last three decades and we have never been a project which implies a huge investment, billions and billions of euros. we always found that the na buco weakness is not to involve any producer. it's not enough for us to insure or investments. >> one thing i wanted to talk to
you about. we have about 30 seconds. the opec meeting from last week to raise production, big political gain, but it gave license to iran and venezuela to say no. can we boost past that? it's the medial term we're concerned about. it's the growth in demand. >> for the time being the market is well served. prices are high. the prices are high, but there is not lack of an offer in the market. now, maybe in two or three years, wide consumption in china and india go out. threaten would be some lack of new production. they may take a different decision. >> but there is capacity here. you believe in the 4 million barrels of capacity that's within opec today. >> yes. these 4 million barrels a day capacity and iraq as a potential.
we are are part of it birk the way. >> finally the last 20 seconds of it here, libya, you're a big producer before. when do you think you can go back in in a large-scale way? >> well, i'm really actively optimistic. i think now is a question of a few weeks that the whole thing should be sorted out. how it will be sorted out, that's another question for which i have no answer, but i'm not expecting that the regime of gadhafi might stay many months more in power. >> okay. it's nice to see you again. once again, paolo scarloni. let's go back to nina. >> we're talking about the na buco pipeline that links the gas lines between turkey. to some extent is what's going on in greece currently overshadowing what's going on in
st. peet etersburg and clouding outlook? >> at the same time you have angela merkel and president nicolas sarkozy meeting in greece to try to sort out the problems. i think it really defines what's happening in the world today. two giant powers of the brit country coming together although they didn't see off on the gas deal and struggling in europe. the message here on the ground has been why is europe delaying this process of restruck turg greece and now we're back to this contagion conversation. there's too much time spent protedding the large creditors of the banks in germany and france and not moving forward to build confident outside of the european union. >> time to get out that crystal ball again. thanks. john dep tear yoes joinifterios. he'll have more from the
economic summit throughout the course of the day. if you're away from your television, fear not. you can check it out online and read hi blog. all of that can be accessed on cnn.com/business360. obviously concerns surrou surrounding greece's economic future and the potential second bailout that hangs in the balance, very, very much concerning markets here in europe. it's not just a hot topic of conversation. as you can see, we geesht the cac 40 down. one of the reasons the markets in france have been so heavily affected by the situation in greece is that some of their largest lenders post significant amounts of high-yielding debt. need i say it's unwelcome times. three years on from the onset of
the credit crunch a lot of them were trying to shore up. as for a look at how things faired in asia, we should be able to see a number of these markets ended the day in red. the nikkei down by 0.6%. hang seng doan. the nikkei down on fierce that the recovery efforts may be curtailed after the march 11 tsunami. there's a lot of talk of heavy infrastructure and some construction companies have been falling. that's why that market is down. that's about it from me on this edition of "world business today." thanks for joining us. "marketplace middle east" is next.
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caps, international energy agency updates its forecast for demand. this week "marketplace middle east" is in russia at the st. petersburg international forum. central needs include diversifying the economy and establishing new relationships within emerging markets. traditionally ties with the middle east and russia dealt with politics and security but the scope of that has changed as was found out. >> reporter: they are the world's energy leaders. russia and the middle east account for more than 60% of global oil reserves and have shared a historic bond. >> russia has had its interest in this region for a long time, even beginning from the period of former soviet union. we have built industry projects, energy projects, projects, we built ports.
>> reporter: billions in arms sales and their expertise has extended across the middle east and north africa. yet today the business potential between the two regions has yet to be exploited. >> when you look at the russian trade with the eu, in 2010 the trade turnover was prox hi 310 u.s. billion dollars. when you look at the trade between russia and northeast africa, total trade was less than $10 billion. so only about 3% of trade between russia and the eu. >> reporter: the european union accounts for more than 45% of russia's total trade, whereas the entire arab world makes up less than 2%. that leaves room for growth. russia's opportunities if the middle east are endless. mining, construction, even banking infrastructure. so far it's focused mainly on
energy. russia's largest royal company signing a gas exploration agreement here in the uae just last year. they marked their first joint project, part of a wider plan to develop oil and gas prospects across the region. >> the initial budget for exploration was approximately 60 billion u.s. dollars. it could go up to 600 to 800 million u.s. dollars. >> reporter: the agreement would allow russia's presentation to expand in the middle east. for now projects may be put on hold but as the landscape changes russia has an opportunity to carve a greater niche on the international stage. >> there's a world in which the emerging powers are more dominant, than, yeah, russia's
going to be a play teller. for countries like saudi arabia, turkey, iran, a relationship with with russia, which is a nearby major power is important. >> reporter: an economic power house, the world's largest oil producer, russia is eager to snap up opportunities in a region that's quickly changing. leone lakhani from "marketplace middle east," abu dhabi. >> reporter: i sat down with the ceo of a bank and he's also chafrman of the holding company. i asked him about the next stage of russian/turkish business relations. >> you have to be patient. you have to see yourself getting skperns in a country like russia. you have to learn.
we thing potential and rewards are more a risk but we see the opposite. >> how it shakes out in who's going to be president in 2012 or not, how does it 'affect realistically your horizon. does it make a huge difference how reforms are pushed forward? >> of course. you want to see these firms pushed. we see that trend. but we look at the growth. growth potential. and, of course, political stability brings economic stability and more consumption in the country. so they all go hand in hand. and we see this happening in russia now. >> people look at the elections for 2012 and wonder which way it's going to go to. as a foreign investor, how do i take away the fact that not a super majority but a substantial victory. what's the net here?
>> the net here or the master base is that turkey's going to continue what she has done successfully. turkey knows her difficulties and certain economic points. government has already started taking certain macrodecisions so in four or five years it's going to diminish some how. turkey's already very friendly, market-friendly. i think they're going to take the opportunities of some of our neighbors, having difficulty to grow. they're going to grow more. >> if you look at the foreign policy here, quite a substantial upheaval with syria, iran on the other side. how does this impact business or the perception of business in your view? >> well, you know, in many of
the big countries across the globe, they have -- they have trade with their neighbors. turkey over the years has always consummated the relationship with europe. just like in past years, they have diversified our trade relations to europe, russia, north africa, middle east. and as these countries do well economically, they become more market-friendly. turkey's going to increase their numbers. and in the last two or three years, they've not affected turkey as much because of this diversification. >> up next, pumping to capacity as opec remains at a stalemate. the international energy agency
comes to russia to put out his forecast for the second half of the year. that story plus a special look at the hermitage museum and its links to the middle east. -why? -why? i love the sun. past sun goddess. every line has a story. [ female announcer ] we all age differently. now there's roc multi-correxion 4 zone moisturizer with roc®retinol and antioxidants. a lifetime of stress lines, sun damage, and worry wrinkles will fade in just 4 weeks. -crows feet... -belong on birds. [ female announcer ] roc multi-correxion. correct what ages you. -aging... -bring it on.
whale thigh failed to establish new production quotas, saudi arabia has decided to go at it alone. it's going to take production from 8.8 to roughly 10 billion barrels a day. this is still behind russia. russia is already pumping at full capacity, 10.26 barrels a day making it the world's number one oil producer. the international energy agency came to russia to put out its forecast for the second half of 2011.
>> it will be as bad as 2008. it's very important to make a lot of things happen. >> a lot of criticism on the way they put soo much pressure on the cartel that it gave an easy excuse for them not to increase at a time when before the meeting it was misjudged. what do you say to that? >> we are always cooperating with them. first thing, they have to produce more if the demand exists. and then if they cannot do enough, then they will complement the gap. as you say, the gap is relatively interesting for the consumer or producer. have to avoid that. >> they recently celebrated
their third century in existence. the hermitage museum is synonymous with st. petersburg. we asked for views on the arab uprisings and what history will tell us. >> the arab world had many uprisings in all of their history and they know how to overcome the uprisings and to once again become very important. people are frustrated. it's not about the economy. it's something where they're not rich but they leave better than they leave before. people are frustrated. they don't feel that they are seeing the similar civilization they had. this frustration comes into the streets but it will allow them to get up and develop into something very wonderful and beautiful again. >> the historical context, is going to be a long and pain f one? . think it will be different in each case, but there are
traditions of solving the problems. i think we are optimistic but we must help our friends. >> is there a historical basis for such trade links to be survived? >> certainly. they have even existed in the middle ages. in the time when they were going to egypt and so on. a lot of traditions which are very good, which we can explore and develop. and when you have traditions it's always easy when thinging are not very new be traditional. we have this. they have been renewed many times and i think now we can develop them. >> that's all for this edition of cnn's "marketplace middle east" for this week. i'm john defterios. thanks for watching.